PCAOB Proposes New Rules for Audit Committee Talks

The Public Company Accounting Oversight Board has a proposed new standard on Communications with Audit Committee. Topics include: the importance of judgment and estimates in financial reports, clear agreement on terms of audit made explicit in the engagement letter, communication of audit strategy (including analysis of risks and use of internal auditor materials), discussion of the going-concern issue and external auditor evaluation of the quality of communication.

The proposal for the most part seems sensible--though I wonder what measurable metrics PCAOB plans to use to evaluate two-way communication.